Media Monitor 4 December 2009

“The memorandum states that two officials will be suspended and one dismissed and that they will also face criminal charges,” said Cosatu North West secretary Solly Phetoe.

“The memorandum also says a full investigation will be carried out on the security company and that Cosatu will embark on legal action against them.”

Cosatu had complained that a Falcon Security employee played a racially offensive CD at a staff function and that guards had strip- searched employees accused of theft.

Sun management on Wednesday acknowledged that some Sun City employees had not been treated with the respect to which they were entitled and promised strong action would be taken against those responsible.

Yesterday morning an estimated 1000 protesters converged on the resort demanding the dismissal of certain managers and the termination of the contracts of the resorts two security companies . The picketers said they would not leave until an agreement had been reached.

By 2.30pm Phetoe said though the understanding had been signed people were still demonstrating. He expected them to disperse shortly.

It was also agreed at the meeting that no disciplinary steps would be taken against those who took part in yesterday’s picket.

In a statement Sun City said operations at the resort continued as normal all day – the first day of the annual Nedbank Golf Challenge.

Police spokesperson Lesego Metsi said no violence had been reported though SABC radio had reported a confrontation between workers and the police. – Sapa

http://www.sowetan.co.za/News/Article.aspx?id=1094210

1.2 Sun City agrees to axe 'racist' security staff

Times, 4 December 2009

Security staff who participated in racist activities at Sun City will be dismissed and face criminal charges, according to a memorandum of understanding signed by Cosatu and the resort.

"The [memorandum] states that two officials would be suspended and one dismissed, and that they would also face criminal charges," said Cosatu's North West secretary, Solly Phetoe.

The document was signed at a meeting between Sun International management and representatives of the trade union federation.

"The [memorandum] also says a full investigation would be carried out on the security company, and that Cosatu would embark on legal action against them," Phetoe said.

Cosatu had complained that a Falcon Security employee played a racially offensive CD at a staff function and that security staff strip-searched employees accused of theft.

On Wednesday, Sun International management acknowledged that some Sun City employees had not been treated with respect and said strong action would be taken against those responsible.

Yesterday, about 1000 protesters converged outside the resort demanding the dismissal of some senior managers and the termination of services of the resort's two security companies.

Sun International also said yesterday that Saccawu had on Wednesday furnished the requisite 48 hours notice to embark upon industrial action, including a strike, at Sun International properties countrywide, in relation to the wage dispute declared on June 10.

In response, Sun International notified Saccawu of its intention to enforce a lock-out of bargaining unit members.

Plans are in place at all Sun International sites to ensure that its hotels and casinos remain fully operational for the duration of the strike.

http://www.timeslive.co.za/business/article219737.ece

1.3 Saccawu to strike against Sun International

Eprop, 4 December 2009

Labour union Saccawu is planning to embark on a nationwide strike against Sun International following a wage dispute. The SA Commercial, Catering and Allied Workers Union is planning to embark on a nationwide strike against Sun International following a wage dispute, the company said on Thursday.

"Saccawu furnished the requisite 48 hours´ notice to embark upon industrial action countrywide at Sun International properties, in relation to the wage dispute declared on 10 June 2009," said spokeswoman Enid Vickers.

In response, Sun International notified Saccawu of its intention to enforce a lock out of bargaining unit members.

Contingency plans were in place at all Sun International properties to ensure that its hotels and casinos would continue to operate fully throughout the duration of the strike action, said Vickers.

Saccawu said on Thursday that Sun International, as one of the most successful hospitality companies in the country, could afford to pay its workers more.

"Despite the economic downturn the company has shown remarkable expansion and growth in profits, yet workers have to turn to the streets to get the company to consider reasonable increases," Saccawu said.

The union said changes in the company were necessary ahead of the 2010 World Cup.

It is demanding a 13% wage increase backdated to July 1, 2009, more employees hired on a full-time basis and an end to the use of labour brokers, a night shift allowance of R7 per hour, an end to the use of interns and changes to tip allocation and collating working hours.

http://www.eprop.co.za/news/article.aspx?idArticle=12020

1.4 C-Class are going Stateside

Taralyn Bro, Business Reporter, Daily Dispatch, 4 December 2009

MERCEDES-Benz South Africa moved quickly yesterday to quell rumours of local production losses after its German parent company announced it would be moving C-Class production to the United States in 2014.

Currently, the West Bank plant – a major employer in the region – manufactures right- hand drive Mercedes-Benz C-Class cars for the local market and left-hand drive cars for export to the US.

In 2008, the C-Class accounted for 85 percent of the SA plant’s production

Germany’s Daimler AG – MBSA is a wholly-owned subsidiary – plans to move roughly a fifth of the production of the C-class model to its only plant in the US, in Alabama.

“This step is essential for strategic and operational reasons, so that Mercedes-Benz remains competitive and can fully utilise future growth opportunities,” said Dr Dieter Zetsche, chairman of the board of management of Daimler AG and head of Mercedes-Benz Cars.

MBSA spokesperson Annelise van der Laan added: “Daimler AG’s intention to re- organise production of the high-volume Mercedes-Benz C-Class indicates a strategic focus on bringing products closer to those markets tipped for strong future growth.”

East London had not been part of Daimler’s announcement this week, and workers at the West Bank factory would have to wait to hear how the moves would affect them.

“Details concerning MBSA’s future planning – including further information about production plans of the C-Class portfolio – cannot be provided at this time.”

However, she said, while the allocation of production to the Eastern Cape had yet to be finalised, “given our reputation, we’re confident”.

Border-Kei Chamber of Business executive director Les Holbrook said the biggest competitor to each Daimler plant was another Daimler plant, as they competed with each other to produce for selected markets.

In future, East London could switch back to producing right-hand vehicles for other markets, such as Australia.

In June this year, MBSA was recognised as the top production plant in the Africa and Europe region by the prestigious JD Power and Associates 2009 Assembly Plant Awards. “There would need to be significant problems to close down the plant,” said Holbrook.

Andile Zitho, National Union of Metalworkers of South Africa regional organiser for the Eastern Cape, said Numsa and MBSA management were scheduled to meet next Tuesday for their last meeting of the year, and this matter would be raised for discussion then. “W e hope the move won’t affect SA negatively.”

http://www.dispatch.co.za/article.aspx?id=364570

2 South Africa

2.1 ANC youth tackles Aids

Canaan Mdletshe, Sowetan, 4 December 2009

THE ANC Youth League in KwaZulu- Natal has vowed to name and shame sugar daddies and sugar mommies to bolster its fight against the spread of HIV and Aids.

The youth body also vowed to intensify its “One boyfriend, One girlfriend” campaign in ensuring safe sex among the youth.

Provincial secretary Bheki Mtolo said they welcomed President Jacob Zuma’s positive approach in the fight against HIV-Aids as announced on International World Aids Day.

“His approach is indeed positive and should be welcomed by all South Africans.” Mtolo said.

“As ANC Youth League we also welcome the decision by the ANC KZN provincial executive committee’s decision to take HIV tests publicly.”

Mtolo said the leadership of the Youth League would follow suit.

http://www.sowetan.co.za/News/Article.aspx?id=1094201

2.2 ANC suspends 25 Limpopo councillors

Alex Matlala, Sowetan, 4 December 2009

The ANC in the Peter Mokaba region of Limpopo has suspended 25 ward councillors in various municipalities.

The suspensions came after allegations that the councillors were linked to the formation of the Congress of the People while others were accused of being lazy, inefficient and corrupt.

The Blouberg local municipality topped the list with nine councillors suspended, followed by Polokwane with six, five in Lepelle-Nkumpi and three from Aganang.

Some of those suspended are Aganang municipality mayor Manoko Masegela and her chief whip John Galane.

The others are Dan Sematla, Levy Mogolwa, Konki Ramalema, Frans Modiba, Simon Mokodi, Mastarch Setati, Phiphine Seraka, Abrinah Mokami, Sam Molea, Mamasegare Mphahlele, Chester Malema, Phelma Masilo, Morongwa Mphagane, Callit Motlatlole and Lehlaga Mphahlele.

The names of suspended councillors from the Polokwane municipality had not been released at the time of going to press.

The ANC’s James Mankge said the decision was taken at a regional executive committee meeting at Miami Lodge in Polokwane yesterday.

http://www.sowetan.co.za/News/Article.aspx?id=1094251

2.3 ANC launches veterans’ league

Zukile Majova and Sapa, Sowetan, 4 December 2009

HUNDREDS of ANC delegates will converge on Esselen Park outside Kempton Park, Ekurhuleni, this weekend to launch the ruling party’s veterans league.

ANC general secretary Gwede Mantashe has confirmed that 400 voting delegates, representing the nine provinces, will converge on the conference centre to launch the league.

Struggle icons expected to make up the league include former presidents Nelson Mandela and Thabo Mbeki, former ANC Women’s League president Winnie Madikizela-Mandela, Albertina Sisulu and Robben Islanders such as Ahmed Kathrada.

Amid speculation that Mandela would become president of the league, Mantashe said: “There is nothing wrong with Mandela becoming president ... but at this stage it’s nothing but a rumour.”

The veterans are also expected to be kingmakers at ANC elective conferences as they have been given voting powers.

Mantashe told a media conference at the ANC headquarters, Luthuli House, in Johannesburg that the veterans would be accorded the status of a province with full voting powers.

“The league will have voting rights like the youth and women’s leagues.”

As an autonomous structure the veterans league will also have rights to comment on the state of the ANC alliance and various squabbles in the alliance.

http://www.sowetan.co.za/News/Article.aspx?id=1094226

2.4 Sama calls for cigarette ad ban

IOL, 3 December 2009

The SA Medical Association (Sama) on Thursday said it was "totally" opposed to cigarettes advertised in whatever shape or form, given their contribution to the burden of diseases.

"Cigarette advertising, even if subliminal, is especially reprehensible when targeting our impressionable youth.

"We therefore share the concerns of the National Council Against Smoking regarding the legal challenge being launched by a Tobacco-manufacturing group against the law currently strictly banning tobacco advertising," said Sama chairman Dr Norman Mabasa in a statement.

British American Tobacco SA (Batsa) has filed an application in the North Gauteng High Court to challenge anti-smoking legislation, the National Council Against Smoking said on Wednesday.

'Smoking reduces a person's life expectancy'

It was asking the court to interpret the legislation so as to allow one-to-one communications between the tobacco trade and those smokers.

Alternatively, Batsa wanted the ban on one-to-one communication declared unconstitutional as a violation of the right to freedom of expression.

Mabasa said in the long-term, smoking causes or negatively influences many diseases like cancer, heart attacks, coronary heart disease, cardiovascular disease and strokes.

It can also play a role in atherosclerosis, abdominal aortic aneurysm, peripheral artery disease, Ischaemic heart disease, angina, emphysema, chronic bronchitis, pneumonia, asthma, diabetes, cataracts, impotence, gangrene and reduced fertility.

"Smoking reduces a person's life expectancy from anything from seven years to 30 years. Generally smokers are less healthy and less physically fit than non-smokers."

Mabasa said they were hoping the courts, like their international counterparts, would issue a ruling that protects the broader public interest, especially in view of the fact that the right to health is enshrined in the Constitution. - Sapa

http://www.iol.co.za/index.php?set_id=1&click_id=3015&art_id=nw20091203103445115C560159

2.5 Barloworld’s Shongwe in union-BEE storm

Franny Rabkin, Business Day, 4 December 2009

A TRADE union has accused Barloworld Logistics Africa CEO Isaac Shongwe of abusing his position as trustee of its investment trust to cash in on its empowerment deals.

Shongwe also heads up investment group Letsema, but Derek Thomas of Letsema Investments yesterday denied any abuse.

On Monday the Chemical, Energy, Paper, Printing, Wood and Allied Workers’ Union’s (Ceppwawu’s) bid to have the bank account of its investment arm frozen will be heard in the South Gauteng High Court.

The union formed an investment trust in 2001 to make investments to benefit the union and its members.

Most of the trustees were union members, but two, including Shongwe, were “professional trustees” with business acumen.

Ceppwawu Investments (CI) entered into a number of lucrative empowerment deals through special purpose vehicles, including one with Aspen Pharmacare.

It also had several management agreements with Letsema Investments.

The agreements said Letsema was entitled to a share of any realisable equity in CI.

In 2002 Letsema’s equity share was 30%, but this was later reduced to 27,5% by agreement.

The trust was party to the most recent management agreement.

In court papers, the union's Thabani Mdlalosi said Letsema’s equity share was a fundamental conflict of interest on the part of Shongwe and was in breach of the trust’s deed.

The deed prohibits trustees, in their personal capacities, from deriving any benefit from contracts entered into by the trust.

But Thomas, a long-term business partner of Shongwe, denied this. “Far from abuse, Letsema’s partnership with Ceppwawu

Investments is enormously beneficial to the union,” he said.

Thomas said Letsema’s relationship with the union predated the trust and the prohibition in the trust deed “never related” to the relationship between Letsema and CI.

He said the “entire union leadership” was aware and approved of the relationship with Letsema, which has been in existence for nine years.

One of CI’s investments in Aspen has recently been unwound. Letsema said its 27,5% of that transaction entitled it to more than R45m.

After paying taxes and the deal’s financiers and expenses, about R119m remained from the Aspen deal for the union’s benefit, according to Mdlalosi.

But he said the union, which was under severe financial strain, has received only about R1m since the trust was formed.

Mdlalosi said that CI may have invested in many good investments over the years but this was “cold comfort” to Ceppwawu. “The irony in the situation is obvious,” said Mdlalosi.

Ceppwawu had been touted by Shongwe and Thomas as a benefactor of the transactions, yet Letsema had “received the greatest benefit”, he said.

Thomas said the correct figure was closer to R3,5m and the money had been invested and a dividend to the trust could be declared as soon as the trust had a quorum.

Shongwe is the only trustee. Thomas said the trust had no quorum because the union had removed its appointees after a change in leadership.

CI has also made numerous other investments, making it worth at least R400m to R500m.

Mdlalosi said taking into account CI’s entire investment portfolio, realisation of 27,5% “is substantially out of kilter with anything done by Letsema or conscionable in the circumstances”.

He said Shongwe should have, as a trustee, investigated and tried to curb payment of such excessive fees, but did not do so because he was “hopelessly conflicted”.

But Thomas said: “CI began at zero. Through Letsema’s hard work, over 10 years, it is now worth over half a billion (rands).” He added that some of the investments must be directly attributed to Shongwe’s involvement with CI.

The deal with Letsema was “consistent with market practice” and there was no conflict of interest because the interests of the trust and Letsema were “parallel”, he said.

Monday’s court case will deal with the union’s urgent bid to freeze CI’s bank account. The union also wants Shongwe removed as trustee.

Thomas said Shongwe’s position was that there is a constitutional process to be followed for his removal. If this is correctly followed, he would abide.

He said Shongwe considered it part of his fiduciary duty to remain on as a trustee, particularly as he had been there from the beginning.

http://www.businessday.co.za/articles/Content.aspx?id=88759

2.6 New life for the left?

Mmanaledi Mataboge, Mail & Guardian, 4 December 2009

Ahead of the South African Communist Party (SACP) descending on Polokwane to reassert itself as South Africa's leading party of the left, a minority of its current and former members are exploring the possibility of finding a new home, arguing that the goal of socialism cannot be confined to the "sole wisdom" of the Communist party.

Organisers of the Conference of the Left, scheduled for March 2010, are on a countrywide consultation mission to secure a minimum of 150 000 endorsements before next year's conference. Though the organising committee did not want to admit outright that it was working towards forming a new party of the left, all indications are that the conference might culminate in the formation of a political party.

"There is no predetermined outcome," said a member of the organising committee, Vishwas Satgar, who terminated his SACP membership in April after running into trouble with the leadership.

Organisers hope to draw support from disaffected members of ailing socialist parties and the Congress of South African Trade Unions.

"It is important to recognise that in the SACP, Azapo [Azanian People's Organisation], PAC [Pan Africanist Congress] and Sopa [Socialist Party of Azania], there are many genuine socialists, workers, radicals and militants who support the broad goals we are putting forward," said a leading member of the organising committee for the envisaged conference, Mazibuko Jara, who is also an SACP member.

Satgar added that there were many disgruntled people within the ANC-led tripartite alliance who have not been offered an alternative for a socialist party. "The alliance did not split two-ways," said Satgar, referring to last year's formation of the breakaway party, the Congress of the People (Cope). "There is a third split, the silent people who are firmly soul-searching and are trying to find a platform."

The idea is to do away with the old model of socialism that used the Stalinist formula, said Satgar. "Our starting point is recognising that those old models are in crisis. We want to get to the renewal of the left politics."

Satgar said the old left is Stalinist and manipulative, and had failed to address real issues that affect the people, such as "the brutal reality of hunger" linked to unemployment. The new left, he said, would seek to fight the struggles that resonate with society. "With the old left you capture the state first through the military or elections, and then you change the society. With us it is not about the state. We want to build power from below."

Jara said despite many socialists identifying with both the ANC and its alliance partners, there was still space for a more united vehicle to drive the improvement of people's lives. "Despite the massive support that the ANC continues to enjoy, so long as it is unable to redistribute wealth and structurally transform this economy, there will always be a case for socialism and the organisation of political and social forces to advance a socialist agenda."

During the same weekend as the SACP's special congress, supporters of the democratic left will be holding a provincial inaugural meeting in the Eastern Cape. A national meeting will be held in Cape Town the following weekend.

The Young Communist League in Gauteng said the process of organising the democratic left conference was "misconceived" and branded it a plan to establish a "post- and pseudo-Cope anti-SACP left-wing formation".

http://www.mg.co.za/article/2009-12-03-new-life-for-the-left

3 SA economy

3.1 Zuma warns no end to jobs loss bloodbath yet

Karima Brown and Amy Musgrave, Business Day, 4 December 2009

SA WOULD lose more jobs in spite of the recession ending and a task team’s efforts, President Jacob Zuma warned yesterday.

And trade unions are also sceptical that the government would meet its target of creating 500000 job opportunities by the end of this year.

Zuma told reporters in Pretoria that the partners who had crafted the country’s response to the global economic meltdown had done the best they could under the circumstances.

The warning on further job losses underlines the fact that, even though SA emerged from recession in the third quarter of this year, the pace of recovery has been slow.

“Although the economy is beginning to grow again, the crisis is still with us, especially for the poor and working poor,” Zuma said after a meeting between the government, labour and business leaders.

The economy has shed close to a million jobs this year and the unemployment rate has increased to 24,5%.

Zuma announced the creation of 500000 work opportunities this year in his first address to Parliament. Public Works Minister Jeff Doidge was optimistic yesterday that the expanded public works programme — through which the work opportunities were to have been created — would be on target.

He said that by mid- November, 330000 unverified job opportunities had been created, while the verified figure stood at 223568.

Only 81 out of 283 municipalities were part of the programme. Doidge said as more municipalities joined the programme, there could be more “uptake”, without giving details of how this could be done before the end of the year.

Verification of the jobs numbers included documenting the identification numbers of participants, checking if they provided value for money and developed skills, and an assessment of their economic impact.

“At November 15 we were at 330000, but this is subject to verification. If we look at these figures, we are well on target,” Doidge said.

Congress of South African Trade Unions (Cosatu) deputy general secretary Bheki Ntshalintshali said yesterday he was sceptical. “The government remains convinced but it is very difficult to know for sure because we are really working in the dark,” he said.

“Unless we have a transparent system by which to measure independently, we remain very sceptical.”

However, the plan to mitigate the effects of the downturn has already yielded some success.

This included 4482 jobs saved through a training layoff scheme, and 7000 through a retrenchment action plan in the manufacturing, engineering and related services sector.

Assistance through the Industrial Development Corporation (IDC) secured about 7700 jobs. The IDC has 33 applications for assistance with a potential value of about R2,053bn.

The task team has agreed to strict conditions for businesses that get state funding, including a restraint on exorbitant executive bonuses, restrictions on retrenchments, and a commitment to buy local.

Next week, Cosatu general secretary Zwelinzima Vavi and his business counterpart, Bobby Godsell, will unveil a plan for companies to curb retrenchments.

The government has also committed itself to a 30-day payment period for small businesses and about R3,7m has been paid so far.

http://www.businessday.co.za/articles/Content.aspx?id=88761

3.2 End of global recession talk just a figment

Terry Bell, Business Report, 4 December 2009

From a labour viewpoint, the claim that South Africa and several other parts of the globe have inched out of recession this quarter is untrue; it is seen as yet another case of arithmetic fraud perpetrated by mainstream economists.

The claims by economic commentators, that the current economic crisis has "bottomed out" and "green shoots" of revival are appearing, are also seen as examples of the statistical mumbo-jumbo in which most such experts seem to specialise.

This mumbo-jumbo concerns number crunching, without any real reference to what the numbers mean in terms of human consequences.

Social and environmental costs are simply ignored and the horrors of the system are disguised by abstractions such as "double dips" and other jargon-ridden terms to describe fluctuations in the casinos that are the stock exchanges.

"At Cosatu we certainly will not be popping the champagne corks," says spokesman Patrick Craven. "We totally disagree. For workers, this recession is not at an end."

So far as the labour movement is concerned, whether or not a recession exists should be gauged on the effects the economic system has on the lives of the majority of the population. Judged in that sense, South Africa - and the world at large - continues to be in the throes of the worst economic crisis in history.

According to the International Labour Organisation, between 39 million and 61 million more workers have lost their jobs this year, raising the official global unemployment total to between 219 million and 241 million - the highest on record. In a world of increasing automation, few of these jobs will return permanently.

"When these jobs are not replaced and when, over the past year, we in South Africa have lost an estimated 770 000 jobs, how can it be said we are coming out of recession?" asks Shane Chosane of the National Union of Mineworkers (NUM).

It estimates that the mining and quarrying sectors of the South African economy alone have so far this year shed 55 000 jobs, about 25 000 of them contract workers. NUM calculates that, on average, each mineworker supports eight dependents.

"So in this sector, we are talking of perhaps 440 000 more men, women and children who will be struggling to survive this Christmas," says Chosane.

The unions also point out that, because the majority of economists tend to concentrate on the balance sheets of companies and on the vagaries of stock exchange indices, they are guilty of practicing what has been called "voodoo economics", economics that has little to do with the reality lived by most of the population.

This is not, of course, a South African phenomenon. It is a global reality.

So economists in the US can blithely talk of the economy having "turned the corner" because productivity in some sectors has risen and house prices appear to have stabilised. But, for example, the US Department of Labour announced that a further 263 000 jobs were lost in the third quarter, making for a total of 15.1 million jobs shed since December 2007.

There is also concern that some of the few bright spots of continuing growth and profitability in the US involve two of the most controversial of sectors, prisons and biological warfare. Prison industries producing everything from brand name lingerie and golf balls to major clothing lines using convict labour paid less than $1 (R7.30) an hour are booming. As too is the sector devoted to developing germ warfare ingredients and their antidotes.

Since free labour - however heavily exploited - cannot compete with the virtual slavery of convict labour, this has meant job losses among workers not only in the US, but elsewhere. Unions everywhere also tend to oppose any development of biological weapons, but are particularly concerned about such development being in private hands, even if a few jobs are guaranteed in the process.

However, the major contributor to what the labour movement refers to as a "jobs massacre" is the inability of the system to cope with technological advances. These have made millions of jobs redundant on the one hand, while producing a massive surplus of goods or less labour-intensive ways of conducting business, on the other.

A classic case concerns the current dispute in Britain over retrenchments in the Royal Mail service, including the closure of many post offices. One of the reasons is the spread of internet connections.

The decline in posted items alone is estimated last year to have lost the British post office £500 000 (R6 million) as more and more people forwent "snail mail" in favour of electronic communication. Postal sorters, transporters and the traditional delivery personnel face job cuts.

"It's the same on the mines here," says Chosane. "Fewer workers and more machines." What this usually means is an increase in productivity - an increase in recorded turnover and profit per worker.

As Craven readily agrees, this amounts to exploiting fewer workers to an even greater extent, providing - at least in the short term - more profits for the minority at the expense of the majority.

As the unions see it, the bottom line should have nothing to do with often convoluted arithmetic calculations of financial profit and loss; it should reflect what happens to the vast real wealth produced on earth: the food, potable water, clothing and building materials. This wealth could sustain every human being, yet, according to UN estimates, 25 000 children alone die every day from poverty.

Looked at in this light, the global economy is continuing to slide deeper into the red. And, as one melodramatic - although still accurate - comment has it: that calculation is written in the blood of millions of working people.

http://www.busrep.co.za/index.php?fSectionId=553&fArticleId=5272925

3.3 The real problem with the South African economy

Jeremy Cronin, Politicsweb, 4 December 2009

Jeremy Cronin on a curious turn to the nationalisation debate. The nationalisation debate...more and more curious.

The present discussion on nationalising the mines runs the danger of becoming too narrowly focused. It's a mistake to detach the question of the ownership of the mines from the overall strategic thrust of our economic policy programme.

This strategic programme has emerged with increasing clarity from recent SACP and COSATU congresses, and from the ANC's December 2007 watershed 52nd national conference. Our shared strategic perspective has been further consolidated at our most recent mid-November Alliance Summit. If we are to make progress in the discussion around the mining sector, for instance, then we need to begin by identifying what we are saying is our key overall strategic economic priority. Last month's Alliance Summit summarised it crisply as "transforming the structure of the economy and moving to a different growth path".

So what is problematic about the structure of our economy? Why do we need to move to a different growth path? At the heart of our problems is that even when our economy has been growing, as it did in the recent past, this growth has tended to reproduce (and in some cases worsen) racialised inequality and under-development.

In 1994 unemployment was around 24%. Just before the global recession began to bite locally, in the latter half of 2008, after some fourteen years of "unprecedented" growth, we had barely managed to return the unemployment level back to the same crisis level of 24%. After 15 years of democracy, and notwithstanding many important efforts, we succeeded in going round in a circle! The rich got richer, but our country was not transformed. In the present recessionary conditions the unemployment levels are now rocketing up, with nearly 1 million jobs lost in this year alone.

Why is it, then, that even in the "good times", our economy reproduces crises of inequality, poverty and general under-development?

The answer is that we are still locked into basically the same semi-colonial economic growth path that was first forged in the imperialist-dominated mining revolution in SA over one hundred years ago. Our economy remains excessively dependent on primary commodity exports. On the other hand, we are excessively dependent on imports of capital goods (machinery), technologies and luxury goods. Even relative to many developed capitalist economies, we have extremely high levels of corporate concentration ("monopoly capital"), especially in the minerals and energy complex, in finance, chemicals, and increasingly in agro-processing. These high levels of concentration continue to shape our economy in many problematic ways. Our economy tends to be capital not labour-intensive. It is extremely energy-intensive, and the infrastructure (transport logistics, ICT, water, energy) is all skewed towards the narrow interests of monopoly capital.

All of these features, along with collusive, monopoly pricing practices by the dominant monopoly capital sectors, serve to throttle any organic growth of more labour-intensive, medium and small-scale light manufacturing, agricultural and service sectors - not to mention cooperatives. High levels of unemployment and skewed infrastructural and spatial development narrow our national market, and further entrench our export-oriented dependency. Historically, big capital in SA has also acted aggressively as a sub-imperialist power, undermining a more balanced approach to regional development and production, further weakening our potential regional market.

This is why our recent Alliance Summit statement is absolutely correct to identify the transformation of the STRUCTURE of our economy as the key strategic task. In fact, this is now the key multi-class and, indeed, non-racial patriotic task of the national democratic revolution in the present conjuncture.

And this is why we need always to ensure that any economic discussion - whether it be about BEE, or infrastructure development, or nationalising the mines - always returns to this fundamental question: Will this or that specific economic policy proposal actively contribute to transforming the highly problematic STRUCTURE of our economy? Or will it, wittingly or unwittingly, simply help to REPRODUCE the same essential semi-colonial structural features?

The strange case of nationalising in order to privatise!

Sello Rasethaba, chairperson of the Lobbying Corporation of SA, has made an interesting contribution to the debate around nationalising the mines ("We should follow the Chinese route", City Press Business, 29 November). Rasethaba positions himself as a protagonist of nationalising mines in SA. His article, however, confirms and compounds the concerns that many of us in the ANC-alliance have about the timing and motivation behind at least some of the recent calls for nationalisation.

Rasethaba mentions, in passing, the SACP's recent interventions on this topic. He claims that "Jeremy Cronin" has said "many mines were now owned by struggling BEE groups, which meant that nationalisation would be little more than a bail-out at taxpayers' expense. I do not know where he [that's me] gets his evidence from, but he is wrong because the top 30 resources companies that control more than 90% of the sector are in white capital's hands and are controlled by foreigners."

There are two major confusions here. No-one has ever said that BEE groups are dominant in our mining sector. What has been said is that our mining sector in general has been hit by the global recession. BEE interests in mining tend to be particularly vulnerable precisely because many operate in marginal mines and because most of their share-holdings are highly geared. Moreover, some (not all) of our resource sectors are now in serious long-term decline. The obvious example is gold, where, despite the recent significant surge in the gold price, output has declined by 9%.

While, in principle, the SACP certainly supports the nationalisation of the commanding heights of our economy, any move to nationalise mines now needs to be closely scrutinised. Would nationalisation be the best allocation of billions of rands of public money in the current reality? Whose class interests would be served? Would we be baling out capital in general and not just BEE elements (although these latter might be particularly anxious to be bought out, given their high levels of indebtedness)? Would we be saddling the public sector (and therefore taxpayers) with the burden of managing down declining sectors, allowing those who have made trillions of rands of super-profits to walk away from responsibilities to workers, communities, and a ravaged environment plundered for over a century?

Then there is the other confusion embedded in what I have just quoted from Rasethaba: "the top 30 resources companies that control more than 90% of the sector are in white capital's hands and are controlled by foreigners." If these resources are controlled by "foreigners", then are they really in "white capital's hands"? Yes, I suppose, if you assume that "foreigners" are necessarily "white". So who are these foreigners? Well, of course, foreign holdings in the SA resources sector are diverse, typically cosmopolitan investment funds and multi-national corporations. In the interesting example that Rasetheba cites, the ASA Metals joint venture, it is a Chinese state-owned corporation that has a 60% controlling interest, while 40% is currently held by a provincial publicly-owned entity, Limpopo Economic Development Corporation (LimDev).

All of this illustrates that it is far too simplistic to divide capital into "white" and "black". (Is Chinese capital "yellow", and if it is state-owned is it then "red"?) I am not for a moment denying that we are living still with the terrible reality of racialised inequality and exclusion impacting upon the black majority of South Africans. In the SACP we are not colour-blind liberals. Our national democratic struggle is all about the radical eradication of national oppression AND the structural realities that still keep reproducing it. We fully support broad-based black economic empowerment (after all, it was the Communist Party that first pioneered this call in SA in the late 1920s).

But to make sense of different sectors and strata of capital, we need to analyse them in terms of their dynamic and functional realities. Is it capital that is largely dependent for its reproduction on productive investment, or on speculation, or on rent-seeking as a comprador go-between? Is it bound to a national market, not so much by sentiment, but by its location within the accumulation process, or is it cosmopolitan? Is it structurally parasitic on the state? Is it locked in by its indebtedness to others? We also need to distinguish between the agents of capital accumulation (owners and managers), with their various subjective political, cultural and ideological inclinations, and the underlying laws of capital accumulation (which ARE colour-blind).

Above all, we always need to ask what leverage the working class and other popular forces, together with our democratic state, have over different sectors and strata of capital and its agents in order to discipline them, as much as possible, into the transformative agenda we have highlighted above.

Unfortunately, Rasethaba's attempt to promote nationalisation asks none of these strategic questions. And he doesn't ask these questions for a very simple reason - he has a very different agenda.

Beneath the surface of his argument a strange paradox is apparent. He is in favour of public ownership of mining interests...but essentially as a route to then privatising much of them on behalf of aspirant black capitalists! He commends Limpopo's publicly-owned LimDev's endeavours "to sell 30% of its [minority] stake in ASA Metals...", and its "expression of interest for a BEE partner to buy 62,5% of its 40% stake" in the same company (I don't quite understand the arithmetic here, but nevermind). But he doesn't explain how any of this will contribute to job creation, or enhanced beneficiation.

He bewails the fact that the "state missed [an] opportunity to assist black mining entrepreneurs by not using the proceeds from the royalties legislation to fund new entrants". Again, he doesn't tell us how using public proceeds in this way would advance the transformation of our skewed, semi-colonial growth path. I am not saying that it wouldn't - but I am saying that we need to know how it would.

He calls on SA to "nationalise companies in strategic sectors" using the balance sheets of the state-owned African Exploration Mining and Finance Corporation, the IDC, PetroSA, the PIC, Eskom and Transnet. But to what end? He tells us that "these entities must expand into the African continent and eventually go global..." Again, he simply replicates the sub-imperial ambitions of Cecil Rhodes and all of his successors. Again he simply calls for the intensification of the same flawed growth path.

It is true that he qualifies himself by saying we must expand beyond our borders "while heeding the national interest and security of the republic and the welfare of South Africans". But what about our neighbours? What about Zambians or Mozambicans or Angolans? What about an entirely different kind of relationship of developmental solidarity between SA and its region?

The ironies of Rasethaba's intervention, where nationalisation is espoused to advance privatisation, are best explained by understanding that he consistently conflates South Africa's national interests with the sectoral interests of aspirant black capitalists. Emerging black capitalists may well be able to contribute to a multi-class national struggle to transform our society. But this will not happen spontaneously. They will need to be marshalled within the discipline of a common strategic objective of transforming the STRUCTURE of our economic growth path. And that is quite a different matter from simply changing the supposed "colour" of capital.

Jeremy Cronin is deputy general secretary of the SACP. This article first appeared in the Party's online newsletter, Umsebenzi Online, December 3 2009

http://www.politicsweb.co.za/politicsweb/view/politicsweb/en/page71639?oid=153475&sn=Detail

Mluleki Mntungwa (Communications Officer)

COSATU ICT Unit

1-5 Leyds Cnr Biccard Street

Braamfontein

2007

P.O.Box 1019

Johannesburg

2000

South Africa

Tel: +27 11 339-4911/24

Fax: +27 11 339-5080/6940

E-Mail: mlu...@cosatu.org.za

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